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IBM CEO says there is 'no way' spending on AI data centers will pay off

businessinsider.com

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Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#691

Post by ThatPlayer »

monster_truck wrote: post #212
PunchyHamster wrote: post #177

Earlier quoted context omitted.

Just not too old. Easy to get into "power usage makes it not worth it" for any use case when it runs 24/7

Seriously. 24/7 adds up faster than most realize! The idle wattage per module has shrunk from 2.5-3W down to 1-1.2 between DDR3 & DDR5. Assuming a 1.3W difference (so 10.4W for 8760 hours), a DDR3 machine with 8 sticks would increase your yearly power consumption by almost 1% (assuming avg 10,500kWh/yr household) That's only a couple dollars in most cases but the gap is only larger in every other instance. When I upg…

A similar one I just ran into: my Framework Desktop was idling @ 5W more than other reported numbers. Issue turned out to be the 10 year old ATX PSU I was using.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#692

Post by rbanffy »

EagnaIonat wrote: post #524
stevenjgarner wrote: post #240

"It is 1958. IBM passes up the chance to buy a young, fledgling company that has invented a new technology called xerography. Two years later, Xerox is born, and IBM has been kicking themselves ever since. It is ten years later, the late '60s. Digital Equipment DEC and others invent the minicomputer. IBM dismisses the minicomputer as too small to do serious computing and, therefore, unimportant to their business. DEC…

I read the actual article. He is pointing out that the current costs to create the data centres means you will never be able to make a profit to cover those costs. $800 Billion just to cover the interest. OpenAI is already haemorrhaging money and the space data centres has already been debunked. There is even a recent paper that points out that LLMs will never become AGI. The article also finishes out with some other…

While AGI might be the Holy Grail, AI doesn’t need to be general human-level to be useful and profitable.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#693

Post by bodge5000 »

mistersquid wrote: post #689
bodge5000 wrote: post #675

Earlier quoted context omitted.

This is the exact kind of thinking that got us into this mess in the first place, and I'm not blaming you for it, it seems to be something all of us do to an extent. We don't look to Meta, who only a few years ago thought that the Metaverse would be the "next big thing" as an example of failure to identify the future, we look to IBM who made that mistake almost 30 years ago. Underestimating a technology seems to stic…

> We don't look to Meta, who only a few years ago thought that the Metaverse would be the "next big thing" as an example of failure to identify the future, we look to IBM who made that mistake almost 30 years ago. The grandparent points to a pattern of failures whereas you point to Meta’s big miss. What you miss about Meta, and I am no fan, is that Facebook purchased Whatsapp and Instagram. In other words, two out of…

> In other words, two out of three ain’t bad; IBM is zero for three.

Many others in this thread have pointed out IBM's achievements but regardless, IBM is far from "zero for three".

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#694

Post by artursapek »

bloppe wrote: post #590
delaminator wrote: post #543

Earlier quoted context omitted.

Your assessment of Claude simply isn’t true. Or Stackoverflow is really good. I’m producing multiple projects per week that are weeks of work each.

Would you mind sharing some of these projects? I've found Claude's usefulness is highly variable, though somewhat predictable. It can write `jq` filters flawlessly every time, whereas I would normally spend 30 minutes scanning docs because nobody memorizes `jq` syntax. And it can comb through server logs in every pod of my k8s clusters extremely fast. But it often struggles making quality code changes in a large code…

It’s not just good for small code bases. In the last six months I’ve built a collaborative word processor with its own editor engine and canvas renderer using Claude, mostly Opus. It’s practically a mini Google Docs, but with better document history and an AI agent built in. I could never have built this in 6 months by myself without Claude Code.

https://revise.io

I think if you stick with a project for a while, keep code organized well, and most importantly prioritize having an excellent test suite, you can go very far with these tools. I am still developing this at a high pace every single day using these tools. It’s night and day to me, and I say that as someone who solo founded and was acquired once before, 10 years ago.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#695

Post by lpapez »

mNovak wrote: post #430
mywittyname wrote: post #167

Earlier quoted context omitted.

Tokens are, roughly speaking, how you pay for AI. So you can approximate revenue by multiplying tokens per year by the revenue for a token. (6.29 10^16 tokens a year) * ($10 per 10^6 tokens) = $6.29 10^11 = $629,000,000,000 per year in revenue Per the article > "It's my view that there's no way you're going to get a return on that, because $8 trillion of capex means you need roughly $800 billion of profit just to pay…

Broad estimates I'm seeing on the cost of a 1GW AI datacenter are $30-60B. So by your own revenue projection, you could see why people are thinking it looks like a pretty good investment. Note that if we're including GPU prices in the top-line capex, the margin on that $70-150B is very healthy. From above, at 0.4J/T, I'm getting 9MT/kWh, or about $0.01/MT in electricity cost at $0.1/kWh. So if you can sell those MT f…

> So if you can sell those MT for $1-5, you're printing money.

The IF is doing a lot of heavy lifting there.

I understood the OP in the context of "human history has not produced sufficiently many tokens to be sent into the machines to make the return of investment possible mathematically".

Maybe the "token production" accelerates, and the need for so much compute realizes, who knows.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#696

Post by oedemis »

Glemkloksdjf wrote: post #652
helsinkiandrew wrote: post #514

Earlier quoted context omitted.

> IBM has not exactly had a stellar record at identifying the future. IBM invented/developed/introduced magnetic stripe cards, UPC Barcodes, the modern ATM, Hard drives, floppies, DRAM, SQL, the 360 Family of Mainframes, the PC, Apollo guidance computers, Deep Blue. IBM created a far share of the future we're living in. I'm no fan of much of what IBM is doing at the moment but it could be argued that its consultancy/…

For the fact that they invented Deep Blue, they are really struggling with AI

ibm developed SSMs/mamba models and also releasing trainings datasets i think, also quantum computing is strategic option..

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#697

Post by iso1631 »

Aperocky wrote: post #522
helsinkiandrew wrote: post #514

Earlier quoted context omitted.

> IBM has not exactly had a stellar record at identifying the future. IBM invented/developed/introduced magnetic stripe cards, UPC Barcodes, the modern ATM, Hard drives, floppies, DRAM, SQL, the 360 Family of Mainframes, the PC, Apollo guidance computers, Deep Blue. IBM created a far share of the future we're living in. I'm no fan of much of what IBM is doing at the moment but it could be argued that its consultancy/…

The other way to look at it is that the entire consulting industry is teetering on catastrophe. And IBM, being largely a consulting company now, is not being spared.

The whole point of a consultant is to let the execs blame someone else.

Nobody got fired for buying something Gartner recommended, or for following EY's advice to lay off/hire

I don't see AI taking that blame away.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#698

Post by consp »

axegon_ wrote: post #681
bodge5000 wrote: post #675

Earlier quoted context omitted.

This is the exact kind of thinking that got us into this mess in the first place, and I'm not blaming you for it, it seems to be something all of us do to an extent. We don't look to Meta, who only a few years ago thought that the Metaverse would be the "next big thing" as an example of failure to identify the future, we look to IBM who made that mistake almost 30 years ago. Underestimating a technology seems to stic…

The amount of hate I've received here for similar statements is astonishing. What is even more astonishing is that it takes 3-rd grade math skills to work out that the current AI(even ignoring the fact that there is nothing intelligent about the current AI) costs are astronomical and they do not deliver on the promises and everyone is operating at wild loses. At the moment we are at "if you owe 100k to your bank, you…

The last sentence sounds a lot like a (partial?) Ponzi scheme.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#699

Post by zahlman »

dragonwriter wrote: post #635
ojr wrote: post #420

As long as the dollar remains the reserve currency of the world and US retains its hegemony, a lot of the finances will work itself out, the only threat to the US empire crumbling is by losing a major war or extreme civil unrest and that threat is astronomically low. The US is orders of magnitude stronger than the Roman Empire, I don't think people realize the scale or control.

> The US is orders of magnitude stronger than the Roman Empire This would be trivially true even if the US was currently in its death throes (which there is plenty of evidence that the US-as-empire might be, even if the US-as-polity is not), as the Roman Empire fell quite a while ago.

I'm pretty sure

> The US is orders of magnitude stronger than the Roman Empire [was]

was the intended reading.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#700

Post by fainpul »

jstummbillig wrote: post #564
written-beyond wrote: post #554

Earlier quoted context omitted.

I'm just as much of an avid llm code generator fan as you may be but I do wonder about the practicality of spending time making projects anymore. Why build them if other can just generate them too, where is the value of making so many projects? If the value is in who can sell it the best to people who can't generate it, isn't it just a matter of time before someone else will generate one and they may become better th…

The value is that we need a lot more software and now, because building software has gotten so much less time consuming, you can sell software to people that could/would not have paid for it previously at a different price point.

But what we're getting is a flood of buggy, unoriginal crap.
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